Indian CEOs concerned over proposed carbon tax by Australia

NEW DELHI: Worried over the impact of a proposed carbon tax on mining activities by Australia on imports, India today expressed hope that an acceptable solution would be found to resolve the issue.

According to media reports, the Australian government plans to impose a 30 per cent tax on big mining companies. It will go into effect in July 2012, and will apply to mining giants such as Rio Tinto and BHP Billiton.

"It is a matter of concern for every industry in the mining sector. We are hoping that the Australian government will find acceptable solution to the issue - mining resources rent tax or carbon tax," Jindal Steel and Power Chairman and MD Naveen Jindal told reporters here after the first meeting of India-Australia CEOs Forum.

India is one of the biggest importers of coal from Australia.

The forum, launched last year, was co-chaired by Jindal from Indian sides and Lindsay Fox AC from Australian side. It aims at enhancing trade and commerce between the countries.

Jindal said that this move may dampen the interest of investors.

"...definitely it will reduce the enthusiasm. If it becomes less attractive, definitely it will dampen the enthusiasm (of the investors)," he said.

However, he said that Australia remains a very resource rich country and India has huge requirements for mining resources.

"I am sure concerns were there, be it Australian companies or Indian companies remains the same. So I think, the government will find a happy medium, a win-win situation for all," he added.

The forum also deliberated on several issues including transportation, skilled labour and matters concerned both Indian and Australian companies.

They also discussed about starting a direct flight between India and Australia, a move that would boost tourism and trade both.

"We have discussed issues like ways to increase investments and issues faced by both Indian and Australian companies on each others soil," Jindal said.

He said that Australia has a huge shortage of skilled manpower, a sector in which India can provide its help.

However, Australian CEOs made it clear that there should not be an export of cheap labour.

On the proposed free trade agreement between India and Australia, he said both the sides are trying to conclude it "as soon as possible".

Both the countries has agreed to double their bilateral trade from USD 20 billion at present, to USD 40 billion during the next five years.